Despite the recent Financial Fair Play regulations being introduced into the European game, the Premier League remains a terrifyingly overpowering industry which gains unrivalled global popularity through all sorts of business and commerce. The new television rights deal which come into force at the start of next season means that all twenty clubs in the top flight will gain an unnecessary amounts of bonuses, which will only serve to increase the widening gap to the division below. The importance for clubs to survive the drop or gain promotion to the Premier League is now on an unprecedented level.
There have been many examples of clubs who have risen up and used the huge pots of the Premier League to grow and stabilise themselves in the upper reaches. Take Stoke City from 2008, Swansea City from 2011 or more recently, Southampton and Crystal Palace. All of these clubs before their promotions were struggling in the Championship and only looked to be heading down, not up. Nowadays, they’re all strong competitors in the top half of the Premier League table. Judging by the start to this current season and the players which they have brought in, you wouldn’t put it past them to bridge that ever-increasing gap to the top 7 and really challenge for European places.
It’s quite remarkable how this money can transform fortunes – especially in the cases of Southampton and Crystal Palace, who have both suffered recent administrations due to a lack of investment, which even nearly saw the latter be liquidated in 2010. Palace were on the brink of destruction and extinction, now they’re up high in uncharted territory and a well-respected Premier League middleweight. You could even throw West Ham United and Leicester City into this mix of clubs also. Although they had more wealth than most in the Championship, their re-emergence into the top flight has allowed them to once again stabilise themselves, such as Newcastle United even did in 2010.
Norwich City are now trying to re-establish themselves after immediate promotion back, and you would bet your bottom dollar that recently relegated clubs QPR, Hull City and Burnley will have this pot of wealth too (in the form of parachute payments)to use to their advantage. It is the harsh reality, though, that clubs who are relegated back to the second division will already have a massive advantage with these payments which come their way from the Premier League. For the clubs struggling to stay afloat near the bottom and running on low finances and in serious debt, they will have to pull off a ‘us against the world’ miracle like Palace did and fight for promotion against all odds with obvious inferiority.
Crystal Palace’s Increase in Revenue since Promotion
However, for every fairy-tale success story, there are numerous demises. It might be easy for us Sotoners to mock and laugh at our neighbouring city’s struggling football club, but Portsmouth is the prime example of how it can all go wrong from it all being so sweet. The two South Coast clubs’ fortunes could not have been any more dramatically reversed. In 2008, Portsmouth had just won their first ever FA Cup and were playing European football against the likes of Ronaldinho’s AC Milan, with top internationals on their side. Pantomime villain Harry Redknapp had returned from his tenure at relegated Southampton in 2005, much to the amusement of all Pompey fans. Now, he was leading the club into the upper reaches of the game. Big transfer fees and high wage packets didn’t seem a problem given the wealthy investment of the Portsmouth owners. Everything was rosy, but for Southampton, relegation and administration was beckoning. Yet 2 to 3 years down the line, Pompey had lost all their wealth and their downfall was impossible to prevent. They are now in the lowest of the four divisions, run by their supporters and a million miles away from where they once were at the top. Due to the excessive amounts of money thrown around in their heyday, their greed got the better of their long term strategy and ultimately lost everything they had. Quite a horrific, nightmare-like fall from grace.
Yet, it should be used as a lesson to all clubs in the English game. Success should not damage your perspective of things, else your sense of security and power could quickly be lost. Queens Park Rangers are a strong case for how a football club should not be run, and it would not be surprising at all if they did a ‘Portsmouth’ and plummeted to the bottom. The alarming fact that they have so far to this date avoided what should be a mega-million pound fine for breaking the FFP rules was reported in the summer soon after their relegation from the top flight, and they were ordered to pay £58 million to the governing bodies, which has seemingly been swept under the radar of the press in recent months. If any club deserves punishment, it should be the west London side. Since owner Tony Fernandes took over in 2009, the club have been spending amounts of money that sometimes beggar belief, considering their position. With no disrespect intended to QPR, they are not currently a big enough football club to ever get near to the revenue they need to match their net spend in the transfer market, unless of course they can regain their Premier League status. Like Fratton Park, Loftus Road is not a Premier League standard sized ground. It only holds around 18,000 people, which is not enough for a club which wants to grow and can grow into a bigger top flight force. Money should be being spent on off-field matters such as improving the facilities, yet they continue to throw money at their big Premier League dream on the field. It’s all well and good for them to have this money, but once the source runs dry (if the owner leaves or they get a hefty fine), then they’re left with huge losses from the high wages and low attendances. It’s an extremely dangerous game for them to play.
When contrasted to the way Crystal Palace have gone about things, a club which is of similar standing to QPR, then it can only be assumed that it is Fernandes’ strategic planning which is the issue. At the end of the day, the way a football club is run is down to the person in charge, but because it’s a community, it’s the fans who are the ones to suffer. Another frightening example of the impact the loss of Premier League money can have on a club is Blackpool. Last season in the Championship, they were probably the most incompetent team you could name in recent years and they were relegated by April. There is no doubting the absolute scandal of the Oyston regime at Bloomfield Road, but you can argue that if they did stay in the Premier League in 2011, then the owner wouldn’t have had to take as much money out of the club to put into his own businesses, as reported. We cannot excuse them though, as there was always a real risk that they could have been relegated, and argument is that if you want to be successful and maintain your success, make sure all is planned and secured for the future.
Other examples of clubs who have suffered considerably from the loss of Premier League football include Charlton Athletic, Wolverhampton Wanderers, Blackburn Rovers, Birmingham City, Bolton Wanderers and, most likely to follow suit in the near future, the likes of Fulham and Cardiff City. The Championship is now just a graveyard of ex-top flight clubs who have lost their way and feel that it is in their own right to return. Upward clubs like Milton Keynes Dons and Brentford offer a refreshing difference, but the longer huge clubs like Nottingham Forest, Sheffield Wednesday and Leeds United stay away from where they once were for so long, then a return to the top flight may never happen for them again, or at least for the foreseeable future. Take note, therefore, of the likes of Stoke, Swansea, Southampton and Crystal Palace, and how they have used their money wisely to reach and stay at the top tables.
The Alarming Losses of Championship Clubs in 2013/2014
Ultimately, if you consider the ever-growing riches which the Premier League clubs attain for their participation in the top flight, it is becoming increasingly difficult for those aspiring to reach it to cut this trend and re-ignite the traditional principle of financial fair-play in English football. Factors to stop this harsh reality for your club are most notably around strategic planning and thinking of the owner, building solid foundations within your club (including non-playing staff, fans, and players) and more obviously, being more sensible when success does come your way. Yet, if the FFP regulations are not limiting the likes of Man City spending £60 million on a player or QPR from continuing to breach its rules, then this gap between the elite and those below it will become too one-sided and kill the beautiful game for many. So, in hindsight, the Premier League itself is becoming a more equal playing ground itself, but the bridge from the Championship is becoming completely the opposite and looks to be burning down.